Awards

Thursday, October 04, 2012

Affordable is a dangerous word. Loan sharks always advertise their services as affordable. So do all sorts of "Get It Now - Pay Later" businesses. If it's affordable, the cost is often hidden or it's not worth even its affordable cost. Often both. And that's because the easiest people to rip off are the people who can't afford things. They are the ones likely to get it now and then keep paying for it later even years after realizing that they didn't want it in the first place.

We are now living in the age of affordable government where we are able to get all sorts of things now while paying for them later. The government is our credit bureau and it is cheerfully borrowing money to pay for all the things that we will owe it for and that it will owe China for and that China will owe whatever economic singularity ends up sucking its economy into a black void.

Nowhere is this clearer than health insurance, which every politician running for every office from dog catcher to supreme emperor of the planet tells us he, she or it are committed to making more affordable.

ObamaCare is a triumph of affordability, turning health care into a national Walmart, offering suppliers a bulk mandatory customer base, including those young people who weren't interested in shelling out the dough for health insurance, in exchange for service adjustments and bulk discounts. Except that health care is not a bulk business and so the discounts don't actually apply. Neither do the savings.

When Walmart orders 2 billion grills or notebooks from China, the factories in some dirty city that used to be farmland a few years ago begin rushing to meet a bulk order. The bulk order allows them to take out loans, get more efficient equipment and pour in 50 percent more pig parts and toxic waste into the slurry and develop a plan knowing that they will be in business for the next six months.

There is no such thing as bulk health care, or rather there is, but you don't want it. Patients still have to be treated individually and while routine patient visits can be staggered, medical problems cannot. Some doctors would like more patients, but bulk insurance does not solve that problem. What it does is jam more patients into the health insurance system, many of whom are there due to the mandate and will impose minimum strain on the system, while paying into the system.

To get back to the Walmart model, this is not like creating discounts through bulk ordering, but like forcing everyone on your block to join Sam's Club, even when they don't buy in bulk and don't need anything that Sam's Club is selling, so that Sam's Club can afford to give you a discount and a little more for your money.

This model of health care isn't any more affordable, it just provides alternative revenue streams for health insurance companies to offset their affordability losses. It's also as ethical as invading Japan and forcing their entire population to join American HMO's that don't cover Japan. That would have a similar effect, but then so would just stealing a few hundred billion dollars and giving it to health insurance companies.

An affordable product is internally affordable. A product can be made more affordable by making its production more efficient, by lowering its quality or by paying employees and managers less. Walmart, for the most part, achieves lower prices by lowering product quality and relying on cheap labor.

We already outsource a chunk of our health care from foreign nurses to x-rays being analyzed in the same places those nurses come from. Cutting costs by cutting labor costs makes health care more affordable, but outsourcing to the Third World also lowers quality drastically. We've learned to accept toasters that last two years and television sets that have to be replaced on a regular basis, but most people are not prepared to swap health care quality for health care affordability.

But this really isn't too much of a concern. With health care unions dominating the landscape, most outsourcing will just involve Third World professionals bringing their low quality of care and low regard for human life to this country. The other side of the coin is patient utilization. And that is the brass ring for national health care systems.

From an expert standpoint, if patients randomly choosing or not choosing to buy health insurance is too chaotic for a stable marketplace, then patients deciding to see doctors or not see doctors is also much too random. In their ideal world, every patient would be plugged into a program that would determine what kind of care he or she needs to provide maximum productivity and anything the patient has to say about it would be ignored. All sorts of rewards and punishments would be applied with the goal of keeping the patient healthy through interaction with lower level medical staff so that he or she will hardly ever have to see a doctor.

As plans go, this one makes Communism seem sane, but it's the backbone of every regional health care initiative which depends on using cheaper staff to teach patients better health practices so as to lower their system utilization. And the plans begin with fighting childhood obesity in the hopes of later saving billions on treating adult health attacks.

At some point we'll just switch to genetically screening babies with a predisposition to weight gain and aborting them in the womb to save all the money that would go to treating their medical problems fifty years later. We won't force mothers to do this. No, we'll offer them incentives, like an extra 150 dollars in food stamps a month or a cash payout of ten grand, which will more than pay for itself, according to the bean counters, from all the money the government won't have to spend on a future walking heart attack.

Like Communism it's evil and like Communism, it's also unworkable because none of the savings will be there fifty years down the road, just an even more expensive and more broken system that everyone hates, yet everyone depends on. Affordable health care will never be affordable, not if affordability measures cost against value. Like a Walmart toaster, the more seemingly affordable an expensive product becomes, the lower its quality will be.

Health care will be affordable, but its value will be far lower, and its cost will be far in excess of that value. Instead of buying a twenty dollar product for thirty dollars, we'll be buying a five dollar product for fifteen dollars. We'll be paying more relative to what we're actually getting. And worse still most of the cost will be hidden. So the actual deal will be paying fifteen dollars for a five dollar product and then being billed fifteen dollars every month in a hidden bill because you thought it was only fifteen dollars, when it was actually fifteen dollars a month. All those unpaid bills, calculated at a horrifying interest rate, add up and are passed on to your heirs so that the toaster now costs more than they make a year.

That's affordability, government style.

The superstores took off, because for all their flaws, they were more competitive. Government isn't more competitive. Its bulk sales only manage affordability by burying the cost or sticking someone else with the bill. The numbers never add up, because there is no motivation to make them add up.

Businesses compete against other businesses, but what do governments compete against? They compete against other governments. How many times have American politicians said that we need to be more like Europe or less like Europe? That's economic competition, government style, but there's no economic element to it. It's just the only thing to do. Just like when Obama blathers on about competing with China, he doesn't care if we beat China, but at his level, there's nothing else to compete against. You either compete against China or you give up and stop bothering.

Governments don't compete against each other in efficiency. Even now when businesses can pick up and leave for more favorable economic climes, the most that countries will do is lower tax rates and offer other incentives. What they won't do is become more efficient at delivering services, because the majority of the population that is dependent on those services cannot pick up and leave.

What governments compete on is building giant useless things, whether it's entire ghost cities in China, national bureaucracies in Europe and America or giant stone heads on Easter Island. The ancient Egyptians built tombs for the dead, we build bureaucratic tombs for the living. It's just something that people with a lot of money and power do with their free time before they go off to play a game of golf or whip a slave.

Businesses compete on making money. Governments compete on spending money. This doesn't make one more moral than the other, but it's a fair warning on who to trust with what functions. You don't privatize national defense and you don't nationalize health care, not unless you want your defense plans sold to the highest bidder and your health care being run by a medical version of the Pentagon.

Government cannot even make itself more affordable, it certainly cannot make anything else more affordable. It cannot do things better, it can do them bigger. This is an asset when building an army, not when providing medical care to individuals. Collectivism works somewhat on tasks where the individual is disposable. It does not work at all when the life of the individual matters.

The 20th Century obsession with turning government into a social safety net by having it act as a national insurance company has already failed, because American governments have robbed the depositor payments over and over again. Assigning those same thieves a program of national health care is insane and an utterly doomed project.

Government is big, but it's not smart. It doesn't have to be smart, because unlike a business, it isn't in a competition. A big business got that way by finding ways to make money. A big government got that way by finding ways to take money. When big business tries to make something more affordable, then however immoral it may be, it operates under real world conditions. When big government tries to make something more affordable, it assumes that total control will allow it to also control all the possible variables that will make the impossible work out. The more it fails, the more control it exerts until it ends in a broken tyranny and nothing works anymore and no one believes that anything can ever work again.

Don't believe that? Head left, take a turn at Moscow and behold the leftovers of the Soviet Union. The Communists had a very simple slogan, "Land, Bread and Peace". They couldn't and wouldn't deliver on even a single one of those. But their health care was affordable, the envy of the whole world, and their death rate for adult men was twice that of the United States. And no, we won't do any better than they did.

10
comments:

Rationally, an individual needs to become able to take care of themselves. Regarding medical care, that means purchasing the services they need, including insurance.

Individuals who fall behind in developing their ability to care for themselves need the help of others. That is natural. By helping others, and knowing we are helping others, we grow spiritually. Traditionally this has been done directly, or through 'benevolent' organizations, groups formed within the community to enhance the giving and helping of individuals.

As the function of helping individuals who cannot (or do not) help themselves becomes taken over by the government, the relationship between the giver and the receiver, the benefactor and the beneficiary, is lost. The giver becomes the taxpayer, who has no sense of giving, and so does not value giving and tries to escape it. The receiver of government (taxpayers') benefits sees themselves as entitled, rather than as falling behind in taking care of themselves and receiving help from others in the gap.

Maybe that's way oversimplifying, but I do think there is an essential flaw in making person-to-person help increasingly indirect, not to mention how 'social benefits' Invariably become such a political candy bar to lure the voter.

Yes that is an important point. People are dumping social responsibilities onto the government because it's easier that way and makes them feel good without the hard work. But they're not asking what the price will be.

Like auto insurance; those companies don't fix your car, they pay mechanics to do that.

And if the providers (doctors and mechanics) end up not getting paid, their numbers decrease. If their numbers decrease, all the insurance in the world isn't going to help.

See, for example, Formerly Great Britain and its vaunted National Health. (They've been making jokes about that for decades. It doesn't seem to have helped.)

As for not allowing pre-existing conditions, if we apply that to auto insurance, we can simply wait till we've had an accident, then buy insurance. (A reasonable fix for pre-existing conditions is to write rules that say, for instance, if you had the mumps as a child, you can't be denied coverage for other conditions.)

cdnbn: You make good points. Beside that, if one feels that charity is the role of government, there's no incentive to give, yourself.

This could explain the vast difference between the charitable giving of Romney (and most conservatives) and that of Biden & Co. (and most liberals).

I see this as an attempt to neutralize the "American Colonization" of the world, to include the administration of healthcare to the public. The taxation of healthcare then allows Obama to distribute healthcare worldwide. The film "2016" does a great job of showing Obama's Anti-Colonial motivation and his desire to redistribute wealth on a global level. What African Americans don't understand is that he does not empathize with their cause since he himself doesn't come from the "American Slavery Machine" of the south, but the "Dutch and British Colonial Machine" of Africa. They're expecting something from him that he has no intention of producing for them.

Daniel, this is not one of your better articles. I work in health care and can evaluate your assertions from the perspective of experience.The title - affordable health care is something that government bureaucrats contemplate on endlessly. Why - Because the US government has become the largest payer of health care costs, and it is ruining the government's ability to pay for other stuff. So they are constantly looking for ways to cut costs. I agree with your point on various healthy living initiatives as a dream that some bureaucrats have for saving money down the line. These initiatives are often so misguided that they spend tremendous sums into the initiative but will never see a practical return on it. Another way for government and insurance companies to cut costs is to ration the services they will pay for. That can be done by refusing to offer the service or by making this service more rotten so that fewer people will try to obtain it. This is the future of a government controlled affordable health care.

The main point about affordable health care being a misleading term is this: It is not meant to make health care more affordable for the individual. It is meant to make it more affordable for the insurance company and the biggest such company is the US government.

I’m just a crazy old curmudgeon. I always see the core, rather than the veneer. I have a good track record though. Among my predictions, back in the 70’s, when pay TV was just beginning to be promoted I saw right through the “no advertising” claims. And now, as I knew would happen, we pay through the nose to be advertised to.

Again, a decade later, when it became a law to wear seat belts, I reasoned that this was the beginning of personal rights being usurped by government and no one would notice because the veneer of safety trumps the core of personal responsibility.

Flashing forward to now, the first thought I had, when the “mandate” reared its ugly head, “So, when it is a law that everyone must have insurance, soon only the richest of the rich will be able to afford private insurance and the rest will be required by law to be dictated to regarding weight, food consumption, exercise, vaccinations, and anything else that reduces and ultimately destroys any independent choices and thinking.

Interestingly there was a TV expose of health tourists into the UK. Non eligible visitors find a 'middleman' (those shown were all from immigrant backgrounds) who register them, for a price, at a GP (primary care practitioner.) All people ordinarily resident are entitled to this free.Unfortunately this then gave the visitors/illegal immigrant an opening to secondary care (hospital),to which they were not entitled, with the expensive MRI & CAT scans etc. The hospitals then assumed that the card showing GP registration gave them rights to free care which to which they were not entitled. For hospitals failing to check up on this or of having the mechanism to check this & enforce payment, the NHS is losing money hand over fist. UK tax payers are unwittingly providing free health care to anyone in the world who can afford to get here.

Will ObamaCare force MDs to accept all patients? Or will the MDs have the freedom to only accept patients with private insurance? Medicaid, in theory, should offer low income patients access to quality healthcare when most MDs won't accept Medicaid patients because

"Affordable is a dangerous word. Loan sharks always advertise their services as affordable. So do all sorts of "Get It Now - Pay Later" businesses. If it's affordable, the cost is often hidden or it's not worth even its affordable cost. Often both. And that's because the easiest people to rip off are the people who can't afford things. They are the ones likely to get it now and then keep paying for it later even years after realizing that they didn't want it in the first place.

In other words Rent-to Own. Get it now, get rooked into a two year contract which ends up costing people double or triple the cost of whatever. By the time people get to "own" something it's on its last legs and they're essentially forced ino signing anothe contract.